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Speaker Carl E. Heastie
 
     
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A09554 Summary:

BILL NOA09554B
 
SAME ASSAME AS S09309-A
 
SPONSORMeeks
 
COSPNSRMagnarelli, Reyes, Cunningham, Glick, Solages, Schiavoni, Wright, Kassay, Carroll P, Raga, Lunsford, Valdez, Stirpe, Lupardo, McMahon, Cashman, Clark, Bronson, Hevesi, Lavine, Forrest, Hyndman, Anderson, Lee, O'Pharrow, Alvarez, De Los Santos, Hooks, Sayegh, Jensen, Rivera, Dilan, Dais, Burdick, Moreno
 
MLTSPNSR
 
Add §595-d, Bank L
 
Enacts the "deed protection act" in relation to prohibiting a mortgage banker or mortgage loan servicer from commencing, maintaining, or proceeding with a foreclosure action on a mortgage loan where such mortgage banker or mortgage loan servicer knows or has reason to know that the mortgage securing such loan is dependent on a deed, conveyance, or other instrument affecting title to residential real property that was procured by fraud, forgery, or other unlawful means.
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A09554 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
 submitted in accordance with Assembly Rule III, Sec 1(f)




 
BILL NUMBER: A9554B
 
SPONSOR: Meeks

 
TITLE OF BILL:
 
An act to amend the banking law, in relation to enacting the "deed
protection act"
 
 
PURPOSE OR GENERAL IDEA OF BILL:
 
The purpose of the bill is to prevent foreclosure on victims of deed
theft.
 
 
SUMMARY OF PROVISIONS:
 
Section One: Titles the bill as the "Deed Protection Act"
 
Section Two: Adds a new Section 595-d to the Banking law.
 
Subdivision One: Prohibits mortgage banks and mortgage loan servicers
from foreclosing on a residential property if they know or should know
that the mortgage loan is derived from a deed procured by fraud,
forgery, or unlawful acts.
 
Subdivision Two: Requires lenders to review the mortgage loan and rele-
vant documents to ensure the mortgage is secured by a legitimate, valid
ownership interest in the property.
 
Subdivision Three: Specifies that this bill doesn't impede any right or
remedy related to fraud or forgery.
 
Subdivision Four: Establishes that a violation of this section is a
violation of Article 12-D of the banking law which governs licensed
mortgage bankers and mortgage loan servicers.
 
Section Three: Effective Date.
 
 
JUSTIFICATION:
 
Citizens throughout the state have reported that they have lost homes
due to fraudulent mortgages borrowed against homes that they own. It is
incumbent upon financial institutions to verify the rightful owner of a
property prior to bringing a foreclosure action. Many New Yorkers who
have fought to obtain the American Dream of homeownership have become
victims of this predatory practice.
 
 
PRIOR LEGISLATIVE HISTORY:
 
New bill.
 
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
 
None
 
 
EFFECTIVE DATE:
This act shall take effect immediately.
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